SEC Charges 11 People in Alleged $300 Million Crypto Ponzi Scheme

[Davidvictorson]

In October 2020, I almost fell victim to this Ponzi scheme. Someone who I looked up to was one of those who promoted and endorsed this scheme. He and his clique of friends had made it big. Some had bought exotic cars, acquired some landed properties in the city and even gotten married. I admired them. Who wouldn't? They were young and rich. Of course, at the time, I never knew it was a Ponzi Scheme. One thing that discouraged me was that I hate any referral-based project or any project that was promoted with the keyword "make money". I had learned my lesson from MMM, a Ponzi scheme that was so popular in 2011 but crashed in 2016. I would later find out that Forsage was a Ponzi scheme. Today, I read on the internet that theSEC had charged 11 people in alleged $300 million crypto Ponzi scheme.  Guess which Ponzi Scheme? That's right.

The Securities and Exchange Commission on Monday filed a civil complaint charging 11 people for their roles in creating and promoting an allegedly fraudulent crypto-focused pyramid scheme that raised more than $300 million from investors.

The scheme, called Forsage, claimed to be a decentralized smart contract platform, and it allowed millions of retail investors to enter into transactions via smart contracts that operated on the ethereum, tron and binance blockchains. But under the hood, the SEC alleges that for more than two years, the setup functioned like a standard pyramid scheme, in which investors earned profits by recruiting others into the operation.

Last month, I received a WhatsApp message from this friend I admired a lot. He asked me to join a group which I did. Apparently, they have rebranded and are now called Meta FORCE. Pretty much the same model and modus operandi with Forsage.


When I protested my inability to recruit anyone he forwarded the following as a means to persuade or better still motivate me.




It is crazy how this guys never relent. I already saw a thread on the forum from a newbie asking questions about this project. I hope everyone becomes aware of this scam project.
My question. Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

Please move the topic if it is not in the right board. Thank you.

[Bttzed03]

~ My question. Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

Try reporting them to SEC with links to their website and social media pages. Show them how they operate and see what happens next. I've done the same thing before and they were quick enough to post a memo warning people not to invest in that ponzi group I reported. I'm just not sure if they were able to apprehend the main people behind the scheme and their promoters.

About your friend, I would probably tell him directly that it's a ponzi scheme and explain why. He might react in a negative way but he'll stop inviting you. That could affect your friendship though

[jackg]

My question. Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

If they have enough information on them then yes they should be able to do that. The issue probably comes with trying to investigate and find people (especially if they're using WhatsApp).

The other issue with this is it just stops one ponzi scheme from continuing, it does nothing to eliminate the others that might open up in its place (possibly with teams close to the ones thst could be prosecuted - it might also not even touch the schemes inner circle of scammers either).

[Zlantann]

My question. Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

According to the report the whereabouts of most of the founders of Forsage are unknown. If SEC investigates and ascertain that they have a case to answers, a warrant of arrest would be issued. If they are found anywhere in the world and such nation has extradition treaty with the US, they can be moved to the US and tried. But the countries that were last known to live in (Russia, the Republic of Georgia and Indonesia) might make the case more complicated.

The SEC has also charged three U.S.-based promoters who endorsed Forsage on their social media platforms.

It is very nice to hear that most promoters of this ponzi scheme would be charged. Recently in my country we have had a rise in celebrities promoting ponzi schemes and other scam related business. And when this firms run away with investors funds these promoters that have large follower-ship in the social media would not be held accountable for aiding scam.  

The scheme, called Forsage, claimed to be a decentralized smart contract platform, and it allowed millions of retail investors to enter into transactions via smart contracts that operated on the ethereum, tron and binance blockchains.

It is really disheartening to still see that people are still falling victims to these fraudsters. One of their greatest tools to attract people is high return on investment. Out of greed and get rich quick syndrome these innocent people invest only to become financial losers at last.



https://www.cnbc.com/2022/08/01/sec-charges-11-people-in-alleged-300-million-crypto-ponzi-scheme.html

[Fundamentals Of]

It might be hard for the SEC itself to investigate every single person involved including those who are doing the menial tasks on the ground. But if you want to include them, you may try reporting them to the SEC. The problem with these people is that they could claim that just like you they are also victims. They could tell the investigating authorities that they're also recruited to the scheme. So the ones who are usually investigated at the top are those who planned, built, and managed the operations themselves.

[Rruchi man]

I almost fell victim to this Ponzi scheme.

the funny thing is that many people still fall victim to Ponzi schemes because they are well packaged and sometimes they can even deceive people that we look up to and because you look up to them we can easily get convinced when they tell us to sign up for a certain scheme with an assurance that it is not a Ponzi scheme. Always do your own research.

Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

I think before the SEC turns their attention to a certain scheme to be investigated they must have been flagged off a couple of times from individuals who have been defrauded and vuctims plus the amount has to be a huge sum, I don't think the SEC goes after every petty Ponzi scheme.

[NotATether]

Someone who I looked up to was one of those who promoted and endorsed this scheme. He and his clique of friends had made it big. Some had bought exotic cars, acquired some landed properties in the city and even gotten married.

What happened to all those people?

Did the Feds arrest them or even chase them down?

[Davidvictorson]

Someone who I looked up to was one of those who promoted and endorsed this scheme. He and his clique of friends had made it big. Some had bought exotic cars, acquired some landed properties in the city and even gotten married.

What happened to all those people?

Did the Feds arrest them or even chase them down?

Nothing happened to them. They weren't arrested or anything like that. It is possible that they do not see it as a Ponzi scheme rather as a way to "make money" since they are all unemployed. Promoting and endorsing the project is their source of livelihood.

[goldkingcoiner]

As much as I like to see the SEC prosecuting criminals who drag down the image of crypto (also thereby dragging down the image of Bitcoin), I still think its kind of their own fault for falling for such obvious scams. It just goes to show that even the extremely stupid have lots of money sometimes.

I mean how hard is it to do your research on potential investment opportunities?

You could even outsource the task by simply asking around or even posting a question on Bitcointalk. You would immediately get warned by even the newest of our members not to put your money into such scams.

[franky1]

My question. Can the SEC go ahead to investigate and charge the folks who are playing several roles in creating and promoting this fraudulent crypto-focused pyramid scheme now before it crashes?

Please move the topic if it is not in the right board. Thank you.

if he is already under investigation due to a previous ponzi. and he is upto it again.
then yes report him

it does not have to crash to be proven a ponzi.
the very fact that he is recruiting is a bad flag.
the fact that he is probably under some restraining order that prevents him from operating a similar business model is a red flag.

they would be very interested in this even before it does crash as they can atleast start their investigations now before its too late rather then letting the shoe drop first and then have to work in retrospect after the fact.

this does not mean he is/will get arrested now. it just means that the SEC can atleast start to build something against him or add charges to existing court filings that show that he has no remorse or desire to rehabilitate himself. and that would affect the sentencing of current case against him.

[OcTradism]

Try reporting them to SEC with links to their website and social media pages. Show them how they operate and see what happens next. I've done the same thing before and they were quick enough to post a memo warning people not to invest in that ponzi group I reported.

Reporting it directly to SEC and they handled it very fast. Do you mean so?

I only reported scammers on Youtube and got good responses but never reported scammers to SEC.

About your friend, I would probably tell him directly that it's a ponzi scheme and explain why. He might react in a negative way but he'll stop inviting you.

Telling and convincing successfully that it is a scam are different. At least you can try with telling the truth and risk to your friend. Next you can try to convincing him that it is a classic scam aims at greed people and inexperienced investors.

That could affect your friendship though

You must be a true friend and have enough bravery to tell your friend a fact. It is what you have to do but listen to you or not, it depends on your friend. Sometimes, friendship will be broken.

[justdimin]

Honestly if this was something that could stick around the world, they would do this to a million people at least. Even the projects that gets created these days are a basic form of ponzi if you ask me, how? They create this fake token, sell it to people, and to make sure that others come in, they pay out of pocket small by small, either via staking rewards, or liquidity or any other 146 methods.

So, if you ask me, this isn't a big deal, it is something quite normal and understandable. We shouldn't be shocked about this at all, people could realize they are getting scammed all by themselves and if they do not, SEC is not bringing their money back to them at all.

[icalical]

I think they could, there was a similar case like this, the project called Bitconnect, long story short, the BitConnect ponzi scheme started on 2016, and they finally run-out of new fool investor on 2018, closed their platform and obviously stealing some money, but shortly after their fall U.S District Attorney freeze most of BitConnect asset. And after that I heard several Ambassador of BitConnect in several Countries is legally sued, I don't follow the case whether they end up going to jail or paying back the investors money, but from this case I think SEC should be able to at least freeze those Ponzi scheme you are talking about.

The latest news about bitconnect

BitConnect Founder Indicted in Global $2.4 Billion Cryptocurrency Scheme